<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): AUGUST 31, 1999
--------------------
GENERAL MAGIC, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 77-0250147
- -----------------------------------------------------------------------------------
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification Number)
</TABLE>
420 NORTH MARY AVENUE SUNNYVALE, CALIFORNIA 94086
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (408) 774-4000
-----------------
Not applicable
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
ITEM 5. OTHER EVENTS
As of August 31, 1999, General Magic, Inc. paid all amounts outstanding
under two term loans in anticipation that General Magic's cash balances would be
insufficient to satisfy a covenant requiring it to maintain cash balances equal
to at least six times the historic average monthly cash burn for the immediately
preceding six-month period. The payment totaled $4.7 million. General Magic will
continue to aggressively manage its costs and expects that its current cash,
cash equivalents and short-term investment balances will be adequate to fund its
operations through the second half of 1999.
General Magic will continue to evaluate additional sources of capital.
General Magic's capital requirements will depend on many factors, including, but
not limited to, the market acceptance and competitive position of its
voice-enabled services; its ability to generate subscription, advertising and
other revenue from its services; the equipment required to support the network
operations for these services; the levels of promotion and advertising required
to market its products and services and attain a competitive position in the
marketplace; and the response of competitors to its services. Effective July 30,
1999, General Magic obtained from an institutional investor an equity line of
credit for up to an aggregate of $20,000,000 of common stock. However, there are
a number of conditions and limitations on General Magic's right to draw down
under the equity line of credit agreement, and it cannot guarantee that
sufficient amounts will be available under the equity line of credit to meet its
needs. If General Magic's sources of capital through the second half of 1999 do
not prove adequate, and in any case to support operations in the year 2000, it
will be required to raise additional public or private financing. No assurance
can be given that additional financing will be available or that, if available,
it will be available on terms favorable to General Magic or its stockholders. If
adequate funds are not available to satisfy its short-term or long-term capital
requirements, General Magic may be required to significantly curtail its
operations, which would have a material adverse effect on its business,
financial condition and results of operation. In the event General Magic raises
additional equity financing, further dilution to its stockholders will result.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED. Not applicable.
(b) PRO FORMA FINANCIAL INFORMATION. Not applicable.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
General Magic, Inc.
By: /s/ MARY E. DOYLE
-------------------------------------
September 8, 1999 Mary E. Doyle
General Counsel and Secretary
